civemaybe t1_j1dj6eq wrote on December 23, 2022 at 2:41 PM

Reply to comment by Shrederjame in The US economy grew much faster than previously thought in the third quarter by barrinmw

He did repeal Glass-Steagel, which laid the groundwork for 2008.

214ObstructedReverie t1_j1e7uv6 wrote on December 23, 2022 at 5:31 PM

The kinds of banks that Glass-Steagel prevented from existing (combo deposit and investment) actually fared better (due to their more diversified assets) in the 2008 crash than those that would have been allowed anyway.

It's much better to blame the Secondary Mortgage Market Engagement Act of 1984 from Reagan.

That bill allowed AA rates mortgage backed securities to be treated like securities, but did jack all to ensure that they were being rated properly. As a result, the system got poisoned by junk mortgage securities being thrown around as if they were as safe as government bonds.